How does the new US tax law affect professional poker players' taxes?

The new tax law treats poker income as ordinary income, requiring taxes to be paid on cumulative tournament winnings per event rather than annual net income. Players can no longer fully deduct losses, leading to significantly higher tax burdens, especially for top players who compete frequently.

How can professional poker players cope with high tax burdens?

Players can adopt strategies such as reserving 20-40% of winnings for taxes; optimizing tax structure by forming companies or trusts; choosing to play in low-tax regions; reducing live tournaments and shifting to online platforms; and consulting professional tax advisors for reasonable planning.

Does the new tax law only apply to professional poker players?

It mainly affects professional poker players, but similar rules apply to other gambling income (e.g., sports betting, casino games). Amateur players may also need to withhold taxes on single winnings above a certain amount (e.g., $5,000), but they can offset by reporting gambling losses.

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Professional Poker Player Forced into Semi-Retirement Due to New Tax Law: Over $48 Million in Winnings Still Overwhelming

June 14, 2026NewsSource: Google News11 views

According to CNBC, a professional poker player with over $48 million in cumulative winnings has been forced into semi-retirement due to high tax burdens under the new US tax law, calling the current tax system 'unsustainable'. The new tax law treats poker income as ordinary income and requires players to pay taxes on accumulated winnings rather than annual income, leading to cash flow strain.

Professional Poker Player Forced into Semi-Retirement Due to New Tax Law

According to CNBC, a professional poker player with cumulative earnings exceeding $48 million has been forced into semi-retirement due to high tax burdens under the new U.S. tax law. The player stated that the tax treatment of poker income under the new law is "unsustainable," significantly impacting their career and financial planning.

Key Changes in the New Tax Law

The U.S. has recently adjusted tax rules for professional poker players. Previously, players could deduct gambling losses against income, but the new law treats poker income as ordinary income and requires taxes to be paid on cumulative prize money from each tournament, rather than on net annual income. This means that after winning a large prize, players must pay high taxes upfront even if they incur losses later.

Impact on Top Players

For top players who frequently participate in tournaments, the tax burden is particularly severe. The player revealed that in 2019, about 40% of their profits went to taxes, and under the new law, this percentage could rise to over 60%. To ease the burden, they have had to reduce tournament frequency and shift to lower-tax regions or online events.

Industry Reactions and Coping Strategies

The poker community has reacted with mixed views. Some players are optimizing their tax structures by setting up companies or trusts, but most believe further adjustments to the rules are needed. Industry insiders are calling for poker to be treated like professional sports or e-sports, with more reasonable tax policies.

Typical scenario: A player with an annual profit of $1 million may need to prepay $350,000 in taxes under the new law. If subsequent losses occur, the tax refund process is lengthy and uncertain.

Expert Opinions

Tax experts point out that professional poker players should carefully plan their cash flow, reserve at least 20% of winnings for taxes, and consult professional accountants. They also recommend paying attention to the varying tax rules in different states.

Conclusion

The new tax law is reshaping the professional poker ecosystem. While top players can adapt through strategic adjustments, mid- and small-stakes players face greater financial risks. If legislative reforms can be promoted in the future, the current difficulties may be alleviated.

FAQ

: The new tax law treats poker income as ordinary income, requiring taxes to be paid on cumulative tournament winnings per event rather than annual net income. Players can no longer fully deduct losses, leading to significantly higher tax burdens, especially for top players who compete frequently.